It has come to pass – and with a most unfortunate lack of punctuality, I might add – that the Korean government has found itself rather behind schedule in presenting its proposed regulations regarding those new-fangled āstablecoinsā. A delay, you see, risking a most inconvenient disruption to their grand scheme of aligning with global standards and, heaven forbid, fostering innovation. One hopes they weren’t too occupied with more pressing matters, such as the selection of suitable ribbons for the latest ministerial ball! š
A Most Unfortunate Oversight by the FSC
Word on the street – or rather, reported by the local newspapers – is that the much-anticipated bill, the āSecond Phase of the Virtual Asset User Protection Act,ā has not materialized before the National Assembly. A rather glaring omission, considering it was intended to address the rather delicate matter of issuing and distributing those won-denominated stablecoins. One does wonder if someone misplaced the document amidst a pile of important correspondence.
The Chosun Biz, a publication of some repute, confirms that the Financial Services Commission (FSC) missed the designated deadline of the 10th of December. Authorities, it seems, had previously set this date for the submission of the bill to the National Policy Committee. A deadline missedā¦ a scandal, practically!
The reason for this delay? A disagreement, of course! It appears the FSC and the Bank of Korea (BOK) have found themselves at odds concerning the issuance of these won-pegged stablecoins. What a muddle! š¤¦āāļø
It was, indeed, whispered about in late November that such a delay was impending, a result of this very disagreement between the financial authorities and the central bank over the proper role of the banks.
Both the BOK and the FSC concur that financial institutions must be involved in the issuance of these tokens. However, the central bank desires a consortium of banks holding a rather commanding 51% stake in any issuer seeking approval. A rather controlling gesture, don’t you think? It smacks of a desire for complete and utter dominion!
The FSC, on the other hand, is inclined to embrace a moreā¦inclusive approach, fearing that handing such a significant share to the banks might discourage those ingenious tech firms and stifle the blossoming of innovation. Such is the quandary of balancing control with progress.
This impasse has left the market in a state of uncertainty. Some tech companies are bravely preparing for approval, while others proceed with a most cautious step, awaiting a clearer indication of the regulatory direction. A most anxious state of affairs, indeed.
A ‘Prolonged Deliberation Process’ Looms
The Democratic Party of Korea (DPK) had hoped to advance its own virtual asset bill by considering the governmentās draft. However, with the governmentās offering delayed, they may be forced to review the bills introduced by other lawmakers first. A most inconvenient turn of events!
Since June, several bills concerning won-pegged stablecoins have been presented to the National Assembly. Mr. Min Byung-deok proposed a āDigital Assets Basic Act,ā suggesting the issuance of won-pegged stablecoins and the creation of a Digital Asset Committee under presidential authority. A bold proposal, to be sure!
In July, both the ruling and opposition parties offered their own versions of a regulatory framework. Mr. Ahn Do-gil introduced an act on the issuance and distribution of value-stable digital assets, while Ms. Kim Eun-hye proposed an act focusing on payment innovation using such assets. š§
Although similar in many respects – both assigning oversight to the FSC – these bills differ on a crucial point: interest payments. The PPPās bill allows for them, while the DPKās completely bans them, fearing disruption to the market. A most spirited debate, one might say!
The FSC chairman, Mr. Lee Eun-won, has recently declared a firm stance against interest payments on stablecoins, mirroring the American GENIUS Act. A principled stand, though perhaps rather restrictive.
Following this latest delay, a member of the National Policy Committee from the DPK lamented that “it looks difficult to narrow the differences between the FSC and the BOK.”
āIf the government bill continues to be withheld, the deliberation process may be considerably prolonged. We may be obliged to examine the bills presented by lawmakers first,ā they concluded, with a sigh, no doubt.
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2025-12-11 09:21